Out of state investments

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Out of state investments

Paul Vu
Member since 2018 · 25 posts · 3 votes

Hoping someone could guide me. I am very new to real estate investing. 

I am interested in mult-family rentals. However, I live in california and the prices here are very high. I do not see a way to make any money investing here. It seems like my money can go further elsewhere.

My questions...without knowing anyone out of state, how can I get started in out of state investments? What is your best 3 tips? What books should I read? How do you study and analyze an out of state area from where you live? I want to take the advice of start now but it is definitely hard to do with market being high and not knowing what exactly is a good deal. 

Also, Ive been listening to the bigger pockets podcast alot. I dream to do the things these great people are doing with RE investments. But I noticed that a lot of the people got in / started at around the crash. They either got burned by it and was able to start over when things were low and come out on top or they got in at the right time. Is there still room for newbies like myself?

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  • John Warren
    Real Estate Broker · 3412 S. Harlem Avenue Riverside, IL 60546 · Member since 2015 · 6k+ posts · 5k+ votes
    8y

    @Paul Vu you can definitely invest successfully out of state. Obviously, your first step is going to be to identify a market that you want to learn. Once you have identified your market, start reaching out to realtors and property management companies. I think that the PM companies will be the most important component as you need them to be your boots on the ground. I have a 20 unit apartment complex in South Bend, which is my out of state investment. It has been very profitable, and this is mainly due to the management company. I tried self managing for a few months with my business partner, and quickly learned not to do that again!

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  • Alina Trigub
    Rental Property Investor · Glen Rock, NJ · Member since 2015 · 3k+ posts · 2k+ votes
    8y

    @Paul Vu  Congratulations on taking the first step and asking the question about RE investing!  You can find a list of recommended books here on BP under Education section.

    In general, there is a ton of great books on multifamily. I have my recommendations listed on my website. So just to give you a few recommendations, start with the two Lindahl books, Gene Trowbridge, and also Rod Khleif's book. 

    In addition, I'd recommend to read through forums here on BP and decide how active do you want to be with your investment. There're ways to be very active or very passive (example, through multifamily syndication). Speak with investors that are doing both sides and determine what fits your personal interests best! Happy to chat offline if you'd like.

    Good luck!

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  • Brett Goldsmith
    Investor · Los Angeles, CA · Member since 2012 · 1k+ posts · 500 votes
    8y

    Locate a market or two that you are interested in investing in. ( This is important and would be a conversation of it's own. )

    Contact reputable agents in those areas ( you can find high rated agents on zillow to interview in basically any area in the states. ) Get in touch with a reputable PM company in the area. Then find a deal to analyze. Buy below market value. Make sure you cash flow after expenses. 

    Potential Gross Income -*.7 ( estimated 30% per year for vacancy and capital expenditures? That may be high for vacancy and capital expenditures depending on area and build but I'm conservative and things tend to always cost more than expected. - Taxes - Insurance - PM Costs - ( mtg if you have a mtg assuming it's PI and not PITI ) = NET Income.

    Get an inspection before you purchase a property. 

    Ask around to other agents, investors, PM company's not involved in the deal and who are in the area for unbiased opinions for their thoughts on the purchase of that property. 

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  • Jason BottPro Member
    Insurance Agent · Nationwide · Member since 2014 · 2k+ posts · 1k+ votes
    8y

    @Paul Vu I would dig deeper into the BP forum posts as there are a ton of member who live in CA that own property our of state.   I'm sure most of those member would be happy to share their story with you if you.

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  • Lane Kawaoka
    Rental Property Investor · Honolulu, HAWAII (HI) · Member since 2011 · 4k+ posts · 2k+ votes
    8y
    Paul Vu I would recommend just reading millionaire real estate investor and focus your time on connecting with investors and stop reading. Another thing is to understand what you bring in terms of money time knowledge. I can help point you in the right direction.
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  • Mark Adams
    Canoga Park, CA · Member since 2016 · 9 posts · 3 votes
    8y
    Home ownership is easier and more affordable than you’d think send me a message if you’d like there are plenty options in California.
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